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Volume 6, No. 5
July 2010


June
Features:

Small Business
and the Internet

“DOCSIS 3.0,
Ready or Not””
By Mike Gould

A2Y Chamber

Leasing Employees - Not A Risk Free Arrangement
By Mel Muskovitz

August Feature: Legal Businesses

September Feature: U-M IMPACT ANNUAL EDITION
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people and firms
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THE AREA'S ONLY LOCAL BUSINESS NEWS MAGAZINE

Ann Arbor Area BUSINESS MONTHLY magazine brings the reader the latest business news and information important to the businesspeople in Washtenaw County. Each month articles cover real estate, legal, Internet, employee concerns and the climate of business in the greater Ann Arbor area. There is news about company employees and feature articles on local businesses. We cover business news from Ann Arbor, Chelsea, Dexter, Manchester, Milan, Saline, Whitmore Lake, and Ypsilanti.

Working Out Of Your
Home Office


Janice Mihem in her home office

Janice Milhem, Milhem Images, Inc.

By David Baker and Margaret Baker

All across the U.S. business owners are operating the business from their home offices. Low overhead, streamlined logistics, new technologies, the short commute, and the blending of work and personal life all add up to make the home office a real option for business owners.

The number of home offices in the U.S. is clearly large, though it is difficult to determine just how large. A 2002 IDC study puts the number of home offices in the U.S. at roughly 40 million, including teleworkers and after-hour workers, with roughly half of those (20 million) thought to be operating a business from the office. Meanwhile, an earlier study (Harris Interactive) estimated that 30% of the 130 million non-farm working adults (U.S. Census) ran a business from home. If we add to this picture 22 million adults working for a business with fewer than 20 employees (SBA), we put the pieces together and estimate the number of people operating a small business out of their home office at roughly 25 million.

Our Experts
To find answers to this question we spoke with four local business owners who have run their business from their home offices and have insights they'd like to share.

Dwight Cendrowski

Dwight Cendrowski, Dwight Cendrowski Photography (www.cendrowski.com)
Dwight is a freelance photographer. What began as a hobby, in 1978 became a full time business that he operates out of his home office. "Most of what I do is photography of people, with an emphasis on corporate portraiture. My work is often incorporated into brochures, ads, websites, newsletters, promotion, etc. I've always worked for a wide variety of clients, such as corporations, PR firms, ad agencies, hospitals, healthcare organizations, and universities."

Dick Fry

Dick Fry, Fry Architecture PLLC (www.fryarchitecture.com)
Dick has been designing commercial and residential spaces in the Ann Arbor area since 1970. In 1998 he and his wife moved to a farm house at the West edge of Washtenaw County where he renovated a farm building that became his home office. He has an office in Chelsea and an office in Ann Arbor, but his creative work is done on the farm. "My location at the farm is as pretty as ever but it's a good distance from my offices, so I tend to work my way back and forth between being at the farm and being in the office."

Boris Shubin

Boris Shubin, MacDaddy (www.888fixmacs.com)
Boris is MacDaddy. He provides consulting, research, analysis, and other IT focused on Apple's OS X operating system (both client and server) and associated Apple Macintosh and Xserve hardware. Boris works out of his home office. "I've worked for Unisys, Compaq, Ford, Merck, First Bank, and even county governments, among others, so I am quite familiar with the technology available that enables who need solid technology expertise to support their business."

Janice Milhem, Milhem Images, Inc. (www.milhemImages.com)
Janice has a rich experience in marketing strategy devoted to business to business development with small businesses, helping companies improve profitability, open up new markets, and promote their businesses. Janice started Milhem Images, Inc. from her home office in early 2009 to combine her experience in working with small business and her passion for photography. "Businesses need to be able to tell their story about who they are, what they do, and why people should work with them. I help them do this in a visual way. I'm not just a photographer, I'm a marketer."

All four of these service-business owners are very happy running the business from a home office. And while each person is different in their approach, there was surprising consistency among all four. We asked each of them what they enjoy about working out of the home office, what challenges they face operating from home, and advice they have for someone considering running a business from a home office.

WHAT WORKS
Our small business owners unanimously agreed that working from a home office is the best scenario.

Dwight:
"Economically, it never made sense for me to have a free standing building…to go somewhere and pay rent and utilities when the kind of work I do doesn't lend itself to studio space. In my case, almost everything I've done in on site or on location. When I shoot for companies or magazines, I'm in their space. When I shoot portraits for a company I set up a studio there. For me the pros have always outweighed the cons."

Dick:
"I like to meet with a client at their office or their home and talk over their situation and what they want to do. But when it comes to finding a solution to their problem, I like to escape up to the farm house studio. The studio is up on the second floor and has five 3x6 windows with a beautiful view that will knock your socks off. So it's primarily for me as a retreat for times when I'm trying to solve a problem or create a solution."

Boris:
"I'm not a really active environmentalist, but I am a big proponent of efficiency. It strikes me as wasteful in our day in age, for someone who has a house, to drive to a different location to do their work. Over the past two years, I have had some personal situations that have demanded a good deal of time and schedule flexibility. Working through the scheduling challenges I've faced recently, would not be possible if I had to clock in at the office."

Janice:
"I love my home office. I have my photography studio as well as all the items I need for running the marketing business. I can focus and complete my work well at my home office. And then when I'm ready to engage others, I'm more social because I'm happy to get out and ready have some great dialogue."

WHAT DOESN'T WORK
Despite the advantages of working from a home office, there are distinct disadvantages that need to be considered and weighed when thinking about setting up an office at home.

Dwight:
"What I don't think works is using the corner of a room. It can be done, but business and personal worlds tend to mesh together in that case. I think you need to separate as much as possible your home life from your work life, and that means a dedicated space. In my case almost everything I've don is on location."

Dick:
"One drawback may be the image you project to your prospects or clients. I don't think many of the corporate clients or larger clients would like the idea of meeting you at your house. That would work a little bit against you. This is changing, but it is clearly something to consider."

Boris:
"Because Macs are very stable, I don't do a too much maintenance work on the Mac side. Without maintenance agreements, income tends to be clumpy, and the recurring revenue is not what you think it would be. It's an opportunity to deliver real value, and thereby get referrals. I suppose it's possible that having an office might bring more exposure to my business, but I don't believe it would be a financial benefit after the various fixed costs. The disadvantage to having a commercial site for your business is all the overhead required for that location: liability, energy, leases, contracts, time tracking, security, maintenance, etc. I come out way ahead in my home office."

Janice:
"Working from a home office does require more from you in certain areas. I think, for example, you have to be much more organized. If you are alone in your home office and you're not planning the lunches with others, you can get pretty confined. You also have to be more disciplined because there are more distractions. If you have kids at home or certain distractions, then you may need to be out of the house; you can't have distractions while you're on the phone."

ADVICE TO OTHERS

Dwight:
Having a home office tends to push you into the idea that you're working all the time. But, of course, that's been the knock on cell phones and other technologies. But to me, that's not a matter of a home office; it's the nature of working for yourself. It's very hard to turn your head off. The job is never just when you're at the client's site. But when you're disciplined, you find ways to turn it off."

Dick:
"Find ways to leverage technology. The leaps in available technology have been a tremendous boost to home offices. I remember back when I was with Hobbs + Black Associates, Inc. (I was Bill Hobbs' very first employee) we had to go down to the photocopy store to get a photocopy.

"It's much different today, of course. You can do large-scale work right out of your home office. For example, I completed a project for a big outfit in Santa Monica. The client was an Ann Arbor-based company that sought to move to a new facility. The mechanical engineer was in San Diego, the electrical engineer was in Atlanta, the builder come out of New York City, and all the drawings were up in the sky so to speak. But we were able to control the whole process right out of my home office at the farm. You can do it if you're smart with how you work."

Boris:
"There are a number of efficient, less expensive solutions for running your business. Many cloud services are now available, that can provide exceptional functionality at reasonable prices. The free version of Google Docs, for example, can fill the need for documents, spreadsheets, presentations, calendars, emails, etc. You can share a spreadsheet with your team online, for example, all for free. Google's corporate offerings, with server storage and uptime guarantees, can run as little as $60 a year, which is very reasonable.:

"The key for the business owner is to understand how your business works, and carefully and wisely choose the services required to support your business. As long as you understand your organization and the critical workflow in it, you can find a solution (or a combination of solutions) that would allow you to implement te needed functionality, and avoid the overhead of a physical centralized location/"

Janice:
"When you operate out of a home office, you have to be even more intentional than usual about networking and participating in area business functions. I make a point to participate with groups such as the Women's Exchange of Washtenaw (WXW), Lunch Ann Arbor Marketing Group (LA2M), Ann Arbor/Ypsilanti Regional Chamber, the New Enterprise Forum (NEF), and Ann Arbor SPARK for various events. It's important to remain connected to the larger business community."

If you want further tips about operating out of a home office, contact Dwight, Dick, Boriss, or Janice directly by going to their websites.

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